Stocks Fall For 3rd Straight Day

By

Alexandra Scaggs

Updated Sept. 26, 2012 5:41 p.m. ET

NEW YORK—Stocks fell for a third straight day, with energy and technology shares posting the steepest declines, as investors were spooked by euro zone instability and a slightly disappointing report on the U.S. housing market.

The Dow Jones Industrial Average fell 44.04 points, or 0.33%, to 13413.51.

The Standard & Poor's 500-stock index closed down 8.27 points, or 0.57%, to 1433.32. Wednesday marked the fifth straight session of declines for the index, its longest streak of losses since July 12. The Nasdaq Composite lost 24.03 points, or 0.77%, to 3093.7.

Energy and technology sectors led the slide in the S&P 500. Crude-oil futures tumbled, despite a surprise decline in U.S. inventories. On the technology side, shares of AppleAAPL-0.87% fell for the third consecutive day after the company reported iPhone 5 sales that disappointed analysts. Other technology shares suffered as well, as the tech-heavy Nasdaq Composite posted its largest three-day drop since July 24.

Sales of new homes declined slightly in August, after economists had expected an increase. The Commerce Department reported that new-home sales fell 0.3% from the previous month to a seasonally adjusted annual rate of 373,000. At the same time, though, the median price for a new home increased 17% from August 2011, reaching a level not seen since March 2007. Figures released Tuesday showed that home prices have posted their strongest year-to-date gains since 2005.

"You certainly can't say that the housing numbers were good enough to snap you awake and say we're going to turn this around," said Bill Stone, chief investment strategist for PNC Financial Services Group,PNC-0.50% which oversees $109 billion in assets.

ENLARGE

The Dow Jones Industrial Average dropped 101.37 points, or 0.8% on Tuesday. Above, traders at the New York Stock Exchange last week.
Associated Press

Protests and riots spread across Madrid and Athens as governments announced more austerity cuts. Katie Martin reports on Markets Hub. Photo: AFP/GettyImages.

Worries about Spain and Greece intensified early in the trading day, pushing European markets into a broad slump. The Stoxx Europe 600 fell 1.8%. Spain looked increasingly unstable—the IBEX-35 index dropped 3.9%—following a call for early elections in the Catalonia region and antiausterity street protests.

Greek trade unions embarked on a general strike over austerity measures. The government is preparing to present budget-cutting plans to euro-zone officials later this week.

"It's a reminder that the European debt crisis is still with us. But that shouldn't be a surprise," said Brian Gendreau, market strategist for El Segundo, Calif.-based Cetera Financial Group, which manages $20 billion in assets.

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Asian markets also fell sharply. Japan's Nikkei Stock Average slid 2%. Reports Tuesday said that China rejected an invitation from Japan to talk at this week's United Nations General Assembly, in light of a territorial dispute between the countries. China's Shanghai Composite Index shed 1.2%.

Front-month crude oil futures dropped 1.5% to settle at $89.98 a barrel, while October gold futures fell 0.7% to $1,754.40 a troy ounce. The dollar rose against the euro, but lost ground against the yen. Yields on benchmark 10-year Treasury bonds fell to 1.616%.

In other corporate news, Jabil CircuitJBL0.40% shares saw the biggest losses in the S&P 500, after the company reported fiscal fourth-quarter earnings that missed expectations. The manufacturer of electronics also announced a $100 million stock buyback program.

U.S.-listed shares of Grupo Financiero Santander Mexico SAB de CVBSMX4.31% gained in their public-trading debut. The deal, with shares listed in Mexico City and New York, has a value of more than $4 billion. Most of the stock was listed on the New York Stock Exchange, making it the biggest deal to hit U.S. exchanges since Facebook.FB-1.26%

RadioShack shares rose after the consumer electronics retailer said its chief executive, James Gooch, will leave the company, effective immediately.

Omnova SolutionsOMN-0.15% slid after the building-materials maker reported fiscal third-quarter earnings that fell short of expectations. It said it expected sales volume for paper chemicals to decline given weak demand and increased competition.

SynnexSNX0.81% shares fell after the technology distribution and supply-chain management firm reported a drop in earnings and a downbeat fourth-quarter view.

Investment strategist Michael Gayed joins the News Hub to discuss what investors should keep an eye out for this fall. (Photo: Reuters)

Candle and home-fragrance designer Blyth BTH1.54%slumped after its nutritional-supplement unit ViSalus withdrew plans to go public, citing uncertain market conditions. It was expected to keep more than 50% of its ViSalus stake following the offering.

GT Advanced Technologies shares fell after it was downgraded to hold from buy by Canaccord Genuity. The firm said that it is "not a near-term possibility" for the company, which supplies parts for tech firms, to start providing sapphire cover-glass for smartphone makers like Apple.

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